Btec Business Level 3 - D1 Accounting

1035 WordsJun 11, 20115 Pages
D1 – Demet Sahin – Business Accounting For this part of the task I have been asked to look at the case study of Superflex UK. Recommend and justify ways in which Superflex could address these problems and improve the cash position of the business. A cash flow forecast is estimation of cash coming into the business and of cash going out of the business over a set period of time. A cash flow forecast should demonstrate that your business will have access to enough money to survive. But when estimating the costs you must give reasonable costs because if you estimate the expenses low and the profit high it will cause problems within the business. The purpose of cash flow forecast is to help you see how much money you are going to make each…show more content…
They should pay the insurance money altogether at the end of the year instead of paying in 2 months. This will be more effective because they would have fewer problems when paying the emergency bills. Reducing costs They must reduce the cost for leasing the toning because it’s too high. I think that it doesn’t worth paying half of your income for leasing the toning table. They must get it for a cheaper price otherwise they won’t make enough profit to survive. The cutting shop must reduce costs on electricity and maintenance because it’s too high and they might not be able to pay their bills it if it stays like this because they overdraft every month. Increase price Cash is the power that enables a business to survive and get on and is the primary indicator of business health. While a business can survive for a short time without sales or profits, without cash it will die. For this reason the inflow and outflow of cash need careful monitoring and management. There is a problem with the inflow and outflow of the cash flow. The income is nearly the same as outflow and they only make £400 profit each month. It doesn’t worth running that service because they are not going to able to pay their expenses and there is no money going to left to the owner of the business. To sort out this problem they must increase the prices but not too much because customers won’t be happy. They could do research on prices to see how much customers

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